USDINR opened at 76.47 y’day and the pair traded in the 76.19-76.57 range. Spot USDINR closed at 76.42, loss of 7 ps for USD as against prior close of 76.49. RBI reference rate was fixed at 76.48 on 04/05. May USD/INR closed at 76.61, loss of 10 ps for USD as compared to prior day’s close of 76.71. May Euro/INR closed at 80.83, GBP/INR at 95.96 and Yen/INR at 59.05. USDINR fwd premia was trading at around 3.75% p.a.  FX reserves stands at USD 603.69 bn as on 22/4.

In 2022-23, FII’S have sold 5401 Cr of Equities in April till date and have sold Rs 1193 Cr of debt in April, till date. In 2021-22, FII’S net sold Rs 128897 cr in Equity segment and have net bought Rs 4805 cr of debt. In 2020-21 financial Year, FII’S nett bought Rs 2,74,203 Cr of Equities and have sold Rs  42820 Cr in debt.

Benchmark Nifty declined 391 points (2.29%) y’day. DOW climbed 932 points (0.20%).Nikkei declined 0.11% and Hang Seng declined 1.10%.

Euro is now at 1.0623, Pound at 1.2626, Yen at 129.01.

Commodities: Gold is now at USD 1900 and WT1Crude at USD 108/Brent at USD 110.45.

Interest rates: USD 10 Yr yield is at 2.94% and 3 m libor closed at 1.23%. Indian 10 yr benchmark yield closed at 7.24%.

Economic news: RBI hiked repo rate by 40 bps, in a surprise move. This is a clear indication of reversal of monetary cycle. RBI has reduced rates by 250 bps since 2019. CRR was also hiked by 50 bps. CRR hike is expected to suck out Rs 87000 Cr of liquidity. RBI Governor said that the economy has weathered the shock.

The Federal Reserve raised its benchmark overnight interest rate by half a percentage point, the biggest jump in 22 years. Fed Chair Jerome Powell said policymakers were ready to approve half-percentage-point rate hikes at upcoming policy meetings in June and July.

However, Powell also said the Fed was not “actively considering” a 75 basis-point rate hike, tempering some market expectations for an aggressive tightening path.

BOE decision is expected later today.

USD declined against majors. Crude rose as EU detailed plans to curb Russian oil imports.

Data highlights: – US ADP employment report showed that US private sector added 247 k jobs, ISM(non mfrg) dipped to 57.1.

-EU PMI(services) was finalized at 57.7 and retail sales declined -0.4% m/m.

Thursday’s calendar: – US Weekly jobless claims

-German factory orders

-UK PMI(services)

Daily Support/Resistance table

MAJOR SUPPORTS/RESISTANCES AND TREND TABLE

Technicals: Spot closed above 200 day major moving averages.20 day moving average is at 76.19. 50 day moving average is at 76.200 day moving average is at 74.88. Daily MACD is in sell zone, implying top at 76.78. Important resistance is at 76.78 and important supports are at 76 and 75.70. Spot closed above its average level of the day.

Intraday supports and resistances for May contract are:

PP: 76.59, S1:76.40, S2:76.20, R1:76.79, R2:76.98.             

Hedging strategy: Hedging decisions be taken according to comfort and accounting rates.

However on directional basis, suggest the following:

USDINR Exports can be hedged at 76.70//77.

CROSS CURRENCY TECHNICALS:

EURO/USD: The pair is below major major moving averages. Major resistance is at 1.08. Next major support is at 1.0475/1.0340.. Daily MACD is in sell zone, implying an important top at 1.1185. Weekly MACD is in sell zone, implying important top at 1.1498.

GBP/USD: The pair is below all moving averages. Daily MACD is in sell zone, implying important top at 1.33 and weekly MACD is in sell zone, implying important top at 1.3730. Important support is at 1.2410/1.2260. Important resistance is at 1.2750/1.2850.

USD/YEN: The pair is above major moving averages. Daily MACD is in buy zone, implying important bottom at 114.40. Important support is at 121.10/118.70.

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